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    2 Replies Latest reply on Jun 6, 2008 12:37 AM by dtominus

    business loan vs cash advance

    gardenia01 Newbie

      I am business owner and need funding for my business during the slow season. I received a call from a company about a business cash advance with information about how a business cash advance is better than a business loan or credit line. I am doubting this type of funding for the simple reason that it envolves my business daily sales and our terminal. I worry thinking they wil get total control of my sales and instead of helping my business put my business into trouble with this type of funding. The idea of no collateral, no closing fees etc is great however I have been in business for 7 years and would hate to make the wrong decision. How can I make sure this company is not a false company. This type of funding is new to me so I am not too convinced however I need funding for my business so this is why it got my attention. An advise from an expert would be appreciated. Thank you.
        • Re: business loan vs cash advance
          Bridge Navigator
          This type of funding is also called factoring and many time low interest rates are advertised becasue they make up for it in "fees" instead. It is all the same - the cost to borrow the money. With "fees" the actually rate can be in excess of 20%.

          Also look for early termination fees and minimum committment fees, etc. Look at total costs when evaluating options not just rate or closing costs.

          I have never been a big fan of factoring as it eats into your profits too much - its like a big credit card. But some people love them. I would be nice if people on the board could share there experiences with this type of lending.

          Develop a good relationship with your local banker. Where do you do your business banking? Have you ever met the loan officer? I would suggest setting up an appoinment and perhaps taking them out to lunch. Tell them you are looking to understand your options. You will probably find them very helpful as their job is to lend money.

          That being said there are other alternatives to banks and some of them can be more flexible. Just do your homework.
          1 of 1 people found this helpful
          • Re: business loan vs cash advance
            dtominus Wayfarer
            I can help you.....

            My name is David Tominus The company I work for is Merchant Resources International
   the great thing about our services is


            1- no ucc-1 filed
            2 - cashadvance is 100% tax deductable ,

            call me at 727-545-9530

            David Tominus
            Merchant Resources International